An examination of relationships among indicators of socioeconomic status, health status, and selected health care utilization of fund allocation

by Boles, Brian Nelson

Abstract (Summary)

Given the current movement to regionalizationand population needs based
funding in health services, it has become necessary to measure resource need to
adjust health budgets beyond an age-sex per capita allocation.
Most existing models for measuring health need have used per capita rates
of mortality and morbidity as either dependent measures, or as independent
measures for association with utilization. While this epidemiologically oriented
approach is both logical and popular, such measures do not translate well into
resourceneed measures. In modem industrial societies, utilization has shifted from
cure aspects to care aspects of health; and sodoeconomic status (SES) has
become recognized as an equally important indicator of health status, and
determinant of utilization-
An exploratory small area analysis was conducted to determine relationships
among s~~08~0nomic
status, standardized mortality ratio, and selected health care
utilization rates in the Alberta population. Acute care hospital cases, purposely
selected to reduce professional uncertainty in the data, were used to develop a
proxy measure of health resource need.
Areas, with a high percentage of poorly educated population, low income, and
high aboriginal component, were found to both use and need a greater degree of
health resources relative to other areas. Areas with high unemploymentwere found
to use less resources but appeared to need more.
Predictedvalues from small area regression analysis were converted into an
SES Relative Value Scale to adjust budget allocations among regional health
authorities inAlberta. The resultwould be a re-alldon of about 4.6 percent of the
total regional health budget beyond an initial allocation by age-sex adjusted per
capita. Some health regions, with high aboriginal and poorly educated populations,
would gain substantially. On the other hand, these same regions tend to not benefit
from age-sex adjustment due to the lower lifespan of their aboriginal populations.
Some regions tend to receive less in relation to their historic utilization patterns.
Thus a transitional mechanism, also provided in the study, may be required in
moving to a needs based funding model.
This study provides only the SES adjustment portion of a population needs
based funding model. Age-sex adjusted populations, weighted by recent utilization
rates at the provincial level, would need to be calculated each budget year.
Additionally, policy would need to be in place for cross-region utilization, and for
providing sewice in remote areas.